What are good investments for me?
June 7, 2005
stev asked:
I’m 17 and have 500 bucks I want to invest. What are some good investments. I don’t really want to do stocks. What are my options? Tax liens? CDs? What is the best choice for me? (I don’t really know what a tax lien is or a CD so please explain)
I’m 17 and have 500 bucks I want to invest. What are some good investments. I don’t really want to do stocks. What are my options? Tax liens? CDs? What is the best choice for me? (I don’t really know what a tax lien is or a CD so please explain)
Thanks
Tax Lien Investing Fund
Comments
5 Responses to “What are good investments for me?”
Tax Lien Investing
You should probably check into opening an IRA or a mutual fund. These are both good investments and both leave the decision making of what to invest in to the experts of the funds. You can keep adding money to each of these to keep them growing.
tax lien investing
Tax liens are a get rich plot in which you purchase someones tax lien and own only the deed rights, not the building on the land, until the person pays you with interest. The idea is if the person cannot pay you the lien then you keep the house because they cannot move it off your land. And you can sue them for payment with interest as a debt. If the person does pay, you only collect the lien and interest which is subject to usury laws. It is worst than stocks because most people who cannot pay taxes, don’t have a house you want or the bank already owns it anyway. CD is a bank account in which you obtain higher interest for lending the bank a large sum of money for a specific time. Your paid extra in interest because the bank pays to keep the money for 6 months without any withdrawal from you or they cancel the interest and give you back the money.
Tax Lien Fund
It depends on when you think you may want to use the money. If you expect it to stay in savings for several years, I’d suggest a no-load mutual fund.
When you have $1,000 put it in something like Vanguard’s STAR fund. It’s steady and will serve you well over the years. You can learn a lot at their website vanguard.com.
Fidelity and T. Rowe Price also offer some decent no-load mutual funds. Do your research and take your pick.
Tax Lien Fund
Right now, I’d recommend buying one of these index funds:
- Ticker: SPY , which follows the S&P 500 (Standard & Poors, a huge rating agency that picks the 500 best companies)
- Ticker: QID , also called Proshares QQQ (which follows the whole NASDAQ market inversely)
What this means is that you’re basically buying one “stock” either SPY or QID that are actually made up of many, many stocks. This also means you have a much smaller amount of risk than just buying one stock.
What you should do now is ask yourself if you think the market will do well over the next few months or do badly. Personally, I think it’ll do poorly, so I’d buy QID, which will give you +2% for every -1% that the market drops.
If you think the market will do well, choose SPY. Hope that helps!
Tax Lien Investing Fund
Start investing by having highly-liquid accounts for emergency situations. These can be a interest-bearing savings, checking or money market account. Contact your local banks for details.
FYI – Kids and teens under the age of eighteen cannot acquire most investments directly.